Proposed Regulations Clarifying Who is a Qualifying Relative for the New $500 Credit

Notice 2018-70 informs individual taxpayers that Treasury and the IRS intend to issue proposed regulations clarifying who is a qualifying relative for the new $500 credit for dependents and head of household filing status for years in which the exemption amount is zero – taxable years 2018-2025.  The notice explains that proposed regulations will provide that the reduction of the personal exemption amount to zero will not be taken into account for purposes of the $500 credit and head of household filing status.  Instead, the exemption amount for the application of these provisions will be treated as $4,150, as adjusted for inflation, for years in which the exemption amount is zero.  The notice further provides that taxpayers may rely on the rules of this notice prior to the issuance of proposed regulations.

Notice 2018-70 in IRB 2018-38, dated 9/17/2018.

Contact or Visit Us Today:

1700 Old Norcross Rd. Suite 2 Lawrenceville, GA 30046

770-277-3830

THE DESTINATION FOR ALL YOUR EXPERT FINANCIAL ADVICE AND SERVICES